Changing History: Increasing Your Chances for Success

MBDA.gov Newsletter

From the National Director

Legislative Corner

Greetings!

The Obama Administration and the Department of Commerce are committed to creating a level playing field so that all American businesses have a fair shot at creating the jobs Americans need and exporting the goods and services the rest of the world demands. At MBDA that commitment translates into giving minority entrepreneurs the tools and resources they need to succeed and opening up opportunities, often in areas where they have had limited success in the past. Winning federal contracts is a great example.

The federal government is the largest purchaser of goods and services in the United States; its annual contracts total more than $500 billion. For decades minority-owned businesses have worked hard to gain access to federal contracts, but far too often, despite their best efforts, they were unable to consistently win those contracts.

This has been a source of frustration both for the minority business owners who seek federal contracting opportunities and the federal agencies that have tried hard to expand opportunities for minority-owned businesses.

In March, MBDA took a step toward changing that history when the Department of Commerce and the Minority Business Development Agency opened the MBDA Federal Procurement Center (FPC). This Center is the direct result of President Obama’s pledge to expand contracting opportunities for minority-owned businesses.

The Federal Procurement Center

Our newly opened Federal Procurement Center in Washington, D.C. is the first business center of its type in the nation that will assist minority-owned businesses in competing for and winning federal government contracts.

On April 3, 2012, Governor Dan Malloy (D-CT) announced a new program designed to promote job creation by providing incentives to employers who hire unemployed jobseekers.

The Subsidized Training and Employment Program (STEP UP), created as part of a jobs package passed by the state legislature, creates two types of hiring incentives for eligible small businesses. A six month wage subsidy is available to small businesses with fewer than 50 employees who hire those from a community with an unemployment rate equal to or higher than that of the state (7.7% as of April 2012). Further, such employees must have an adjusted family income equal to or less than 250% of the federal poverty level.

New Lending Program: SBA Seeks Non-Profit Lenders to Make Business Loans

Small businesses, especially those in underserved markets looking for loans up to $200,000, will soon have access to twice as many community-based funding sources under the Small Business Administration Intermediary Lending Pilot Program (ILP). The SBA recently announced it has opened a second round of applications for the ILP.

The ILP provides long-term loans to eligible non-profit intermediary lenders to finance their lending to small businesses. Under the program, SBA makes loans of up to $1 million to participating lenders who use the funds to make smaller loans to startup, newly established and growing small businesses. SBA anticipates that an ILP Intermediary will relend its ILP Loan funds approximately 2.5 times over the 20-year term.

The MBDA Business Center - Chicago, operated by the Chicago Minority Supplier Development Council, Inc. (Chicago MSDC) in partnership with the Illinois Hispanic Chamber of Commerce (IHCC), has a diverse staff of six with experience in banking, entrepreneurship, law and supplier diversity. Since it started in 2011, the MBDA Business Center - Chicago has assisted over 120 MBEs in obtaining over $320 million in contracts and financing and helped to create over 200 jobs.

Among its many successes, the Center played a critical role in assisting a client with a strategic acquisition that allowed the company to expand into Wisconsin, and engage with Fortune 500 Corporations. As a result, the company has significantly increased its sales and its market. Earlier this year, the Center assisted the client in refinancing all of its debt, which came to about $10 million and represented the retention of over 65 jobs.

Spotlight On promotes the work of our nationwide network, center by center.

MBDA Announces New Business Center in Memphis, TN

MBDA recently announced it will award $3.4 million in grants to support the creation of a new MBDA Business Center in Memphis, TN, and existing centers in Houston, TX and New Orleans, LA. With the addition of Memphis the Agency’s footprint covers 26 states and the District of Columbia and Puerto Rico.

Memphis was chosen as a new location because it offers significant opportunity to create new jobs in the Delta region, which has a notable minority population and a long history of entrepreneurship and innovation.